Assignment X1

[zuglubuglu]

Hi there, I have had some queries on this assignment (for 2015 Examinations).

Question X1.3

Are exam marks generally as restrictive? For example in this there could only be only up to one additional mark for relevant points but there are quite a number that are not listed here. For example

• Benchmarks become more useful since companies are using similar pricing.
• May reduce anti-selection since there may be no to little advantage in using additional risk-factors.
• Ease of entry to market to new insurers or for insurers to write new classes of business.
• May actually reduce innovation since some produces may have a premium outside of the given range.
• Reduces competitivity in writing international cover as competitors based abroad do not have this limitation.
• Some clients may be refused cover altogether while other clients may decide not to take insurance cover as their premiums rise. This results in a change of the mix of business.
• And more importantly less scope for aggregator sites (or better still no annoying insurance price comparison adverts).

A similar claim could be made to question 1.9. Isn't there scope for additional marking for other items listed that are not in the marking schedule?

In question 1.5 , is there scope to purchase D&O insurance to cover for the friends or his/her manager's decisions?

Aren't some of the items listed in question 1.8 proxies for risk factors rather than actual risk factors? For example safety features and use of vehicle.

 

[Darren Michaels]

Hi there

In the ST exams you wouldn't expect more than say 5 or so "bonus" marks across the whole paper. This would probably be say 1 or 2 marks extra across 3 or 4 questions say on the whole paper. There is a lot more scope for "bonus" marks on an SA exam paper (and less/none on the CTs). Although your additional points are not wrong, some of them are slightly more obscure so you wouldn't probably get more than one additional mark in total. Some questions i'm afraid like 1.9 in this case don't have any scope for any additional marks.

On question 1.5 I guess your friend might buy D&O cover, but this would be more common in larger organisations where there was scope for the Directors to be sued by the shareholders.

On question 1.8, remember that a risk factors are any factors that have a bearing on the amount of risk. Safety features and use of vehicle would therefore fall into that category. Sometimes the distinction between risk and rating factors is slightly blurred.

 

[zuglubuglu]

Thank you for your prompt reply.